MLB signs deal with game operator NFT Fantasy

Major League Baseball delves deeper into NFTs.

The league said this morning it had signed a deal with Sorare, a Paris-based startup that operates a fantasy sports game with NFTs, or non-fungible tokens. Users can pay to collect tokens representing players, and the tokens accumulate points proportional to player performance in actual games.

A spokeswoman for Sorare said the company was providing MLB with a guaranteed upfront payment against future royalties from the token sale, but declined to provide a dollar value for the deal. The league and Sorare will share the revenue from the sale of the tokens, which are also traded between players in the fantasy game.

The price of tokens will vary depending on their rarity: Sorare tokens for other sports like soccer have changed hands for free and have sold for up to $600,000.

Sorare is part of a growing generation of venture capital-backed start-ups using NFT, a kind of digital deed that confers ownership of a distinct item or special service. Last year, Sorare raised $680 million at a $4.3 billion valuation from investors including Benchmark, an influential venture capital firm that made early bets on Uber, eBay and WeWork.

In an interview, Nicholas Julia, managing director of Sorare, said the company was profitable and generated around $100 million in revenue last year, which it shared with the leagues.

The MLB deal is part of a larger strategy for Sorare to expand in the United States by courting fans of other popular sports leagues, Mr. Julia said. The company opened an office in Manhattan’s SoHo neighborhood and began hiring American executives, including Ryan Spoon, a former ESPN executive who was most recently BetMGM’s chief operating officer.

Not the first NFT deal for MLB In April, the league announced it was expanding its pact with Candy Digital, a company that produces NFT baseball cards. Major players in sports media and technology are seizing on NFT as a promising business sector, with the NBA and NFL Players Association exploring new opportunities.

Sorare could face major competition from established companies that operate rival fantasy games. DraftKings, the publicly traded daily sports and fantasy betting company, struck a deal last year to create Reignmakers Football, an NFT fantasy game.

In an interview, Mr Spoon said Sorare had an advantage over rooted players as he was not distracted by building other businesses or handling a quarterly earnings call.

“Our partners and players expect us to focus exclusively on that,” Spoon said.

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